Global ETF News Older than One Year
Inequality, Leverage and Crises-IMF Working Paper
November 24, 2010--The paper studies how high leverage and crises can arise as a result of changes in the income distribution. Empirically, the periods 1920-1929 and 1983-2008 both exhibited a large increase in the income share of the rich, a large increase in leverage for the remainder, and an eventual financial and real crisis.
The paper presents a theoretical model where these features arise endogenously as a result of a shift in bargaining powers over incomes. A financial crisis can reduce leverage if it is very large and not accompanied by a real contraction. But restoration of the lower income group's bargaining power is more effective.
view Inequality, Leverage and Crises-IMF Working paper
Source: IMF
Dow Jones Sustainability Index expanded to cover 20% of world index
Move follows split from STOXX earlier this year
November 23, 2010--SAM, the Swiss sustainability fund manager, and Dow Jones Indexes, are to broaden out their joint global sustainability index product, with the launch of the Dow Jones Sustainability World Enlarged Index on November 30.
The new index will increase the number of component companies to 20% (513 comanies) of the largest 2,500 companies in the Dow Jones Global Total Stock Market Index. The existing DJSI World Index, which was launched in 1999, covers 10% of the global universe, or around 300 companies. The new index will be reviewed annually and weighted according to free float market capitalization. It will have a subset index of 459 components that excludes tobacco, alcohol, gambling,
Source: Responsible Investor
Understanding Financial Interconnectedness-IMF Working paper
November 23, 2010--Summary:
This paper seeks to advance our understanding of global financial interconnectedness by (i) mapping aspects of the architecture of global finance and (ii) investigating critical fault lines related to interconnectedness along which systemic risks were built up and shocks transmitted in the crisis.
It thus takes initial steps toward operationalizing enhanced financial sector and macro-financial surveillance called for by the IMF’s Executive Board and by experts such as de Larosiere et al. (2009). Getting a better handle on interconnectedness would strengthen the Fund‘s ability, together with the Financial Stability Board, to track systemic risk concentrations. It would also inform spillover and vulnerability analyses, and sharpen bilateral and multilateral surveillance.
view Understanding Financial Interconnectedness-IMF Working paper
Source: IMF
November 2010 “Market’s Measure” Preliminary Report - A Monthly Report From Dow Jones Indexes On The Performance Of U.S., European, Asia And Other Global Stock Market Indexes
November 23, 2010--Dow Jones Industrial Average Posts 0.54% Gain in November, European Stocks Lose 1.47%, Asia Rises 2.27% and World Equities Rise by 0.08%
Automobiles & Parts Sector Posts Biggest Gain for November in Worldwide
Financials Sector Takes the Hardest Hit for November in Europe
As of November 22, the Dow Jones Industrial Average rose 0.54% in November, closing at 11178.58. Stock market indexes in Europe fell while Asia and globally indexes were up in November, according to preliminary monthly figures from global index provider, Dow Jones Indexes.
The Dow Jones Industrial Average rose 0.54% in November, closing at 11178.58. Year-to-date, the index is up 7.20%.
The Dow Jones Europe Index fell 1.47% in November to 265.48. So far this year, the index is up 0.47%.
The Dow Jones Asian Titans 50 Index rose 2.27% in November to 138.78. So far this year, the index is up 3.36%. •The Dow Jones Global Titans 50 Index rose 0.08% in November, closing at 170.86. Year-to-date, the index is down 1.61%.
Source: Mondovisione
Quarterly National Accounts - GDP Growth - Third Quarter 2010, OECD
November 22, 2010--OECD GDP growth slows to 0.6% in the third quarter of 2010
Gross domestic product (GDP) in the OECD area grew by 0.6% in the third quarter of 2010. This marks the sixth consecutive quarter of growth, but is down on the 0.9% recorded in the second quarter.
Euro area and European Union GDP grew by 0.4%, down from the 1.0% recorded in the previous quarter. At 0.7%, growth in Germany remained relatively robust but this was still sharply down on the record 2.3% growth recorded in the previous quarter. GDP growth also slowed in France (0.4%), Italy (0.2%) and the United Kingdom (0.8%). Growth rates accelerated in Japan (0.9%) and, marginally, in the United States (0.5%), compared to the previous quarter.
Relative to a year earlier, GDP in the OECD area expanded by 3.1%, the same rate as in the previous quarter.
Source: OECD
Physical commodities draw scrutiny
November 22, 2010--Regulators are to examine trading in some of the biggest physical commodity markets, where actual raw materials such as oil change hands, expanding efforts to overhaul their oversight of derivatives.
In contrast to financial commodities markets, which are tightly scrutinised by national watchdogs, the global physical market is largely unregulated. The industry relies on common law and on private pricing agencies for price discovery.
Source: FT.com
November 2010 Monthly Preliminary Performance Report Dow Jones-UBS Commodity Indexes
November 22, 2010--The Dow Jones-UBS Commodity Index was down 1.47% for the month of November. The Dow Jones-UBS Single Commodity Indexes for Silver, Feeder Cattle and Lean Hogs had the strongest gains with month-to-date returns of 10.64%, 5.96%, and 5.58%, respectively. The three most significant downside performing single commodity indexes were Zinc, Corn and Sugar, which were down 11.15%, 10.31%, and 10.20% respectively, in November.
Year to date, the Dow Jones-UBS Commodity Index is up 4.25% with the Dow Jones-UBS Cotton Sub-Index posting the highest gain of 68.29% so far in 2010. Dow Jones-UBS Natural Gas Sub-Index has the most significant downside YTD performance, down 42.22%.
Source: Mondovisione
Private Equity Faces Fund-Raising Crunch
November 19, 2010--Wall Street Journal reports, private equity is in a tight spot. Buyout firms are sitting on $450 billion in uncommitted capital they raised before the financial crisis. Now, they are rushing to spend it before the cash must be returned to investors.
That is driving up the cost of making new investments at a time when debt still is scarce. That could make life difficult for the many firms hoping to raise new funds in 2011 after a three-year break.
Source: Wall Street Interactive
The World Bank Launches a New Digital Collection: The Complete World Development Report Online
November 18, 2010-- A new online collection of all World Development Reports since 1978 was launched today by the World Bank.
The Complete World Development Report Online, which allows users to easily access and search across these World Bank annual flagship publications, is free and open to the public and may be accessed at http://wdronline.worldbank.org.
For over thirty years, the annual WDR has provided a window on development economics to a broad international readership. The report has served as one of the principal vehicles for encapsulating the World Bank’s knowledge of and policy recommendations on key global development trends. From agriculture and the environment to economic growth and international trade, the WDR has tracked theoretical and empirical findings as well as policies in the field of international development.
Source: World Bank
Economy: Growth picking up steam but recovery uneven, says OECD Economic Outlook
November 18, 2010--Economic activity in OECD countries will gradually pick up steam over the coming two years, but the recovery will be uneven and unemployment will remain persistently high, according to the OECD’s latest Economic Outlook.
With the functioning of the financial sector returning to normal and households and business in a position to renew spending and investment, the main challenge facing governments today is moving from a policy-driven recovery toward self-sustained growth.
“As stimulus is withdrawn, governments will have to provide a credible medium-term framework, to stabilise expectations and strengthen confidence, particularly for the private sector,” OECD Secretary-General Angel Gurría said. “Enhanced confidence could result in a faster-than-projected recovery"
Source: OECD
